I use that construction whenever I don't want to add complexity to the problem. It's just a list, no need to say what kind of List it is, as it doesn't matter to the problem. I often use Collection for most of my solutions, as, in the end, most of the times, for the rest of the software, what really matters is the content it holds, and I don't want to add new objects to the Collection.
Futhermore, you use that construction when you think that you may want to change the implemenation of list you are using. Let's say you were using the construction with an ArrayList, and your problem wasn't thread safe. Now, you want to make it thread safe, and for part of your solution, you change to use a Vector, for example. As for the other uses of that list won't matter if it's a AraryList or a Vector, just a List, no new modifications will be needed.